Health insurance is an important part of personal financial planning for any individual. In Singapore, there are many types of health insurance policies available for different individuals. There are different types of insurance available in Singapore such as
- Disability Income Insurance
- Total Permanent Disability
- Severe disability Insurance
So here are some of the things that you need to know about disability insurance while living in Singapore.
1. Protects the Beneficiaries Financially
Many people get confused with life and disability insurance. In fact, the biggest difference between the life and disability insurance is the event that triggered the issues. When it comes to life insurance, your beneficiaries are the people who will receive the benefits after you die. But what if your disability is not fatal enough? As long as the disability resulting from an illness or accident renders you incapable of working to earn an income, you will be paid the disability income. With disability insurance, you are covered right when you need it the most to recover.
As long as the disability resulting from an illness or accident renders you incapable of working to earn an income, you will be paid the disability income. With disability insurance, you are covered right when you need it the most to recover.
2. The Payout Isn’t Lifelong
The benefits that you receive by the disability insurance is not intended to provide the expenses of the lifetime. They are meant to cover the expenses that occur when you aren’t working and the expenses spent to recover while taking care of your dependents. The coverage is not intended to replace the whole income, and therefore, making it more affordable. For example, you can buy an individual policy at the age of 50 and qualify for disability income payout five years later.
The individual will receive the payout and it will only be given till the age of 65. In other words, your disability insurance is health insurance and not your life insurance.
3. Provides Peace of Mind During Recovery
When you do not have disability insurance, your recovery period can turn out to be quite stressful and challenging. Having disability insurance makes your recovery period less stressful as you are assured that your dependents are financially covered. You can easily focus on your recovery without worry.
4. Disability Incomes Are Tax-free
The benefits that an insurance policy pays you is tax-free. You can ensure that the benefits received are tax-free. They are completely tax-exempt because you have paid your premiums beforehand. Therefore, you won’t be taxed twice for the benefits that you receive.
5. Coverage Applies Only If You Are Employed
Disability insurance covers you only when you are employed. In case, you encounter a disability while you are employed, as per the definition of the insurer, you are not eligible to receive the payout that you have expected. But sometimes, your occupation prevents you from finding the right policy for yourself. People who are self-employed (freelancers, consultants, and even small business owners) are uncomfortable to underwrite the policy because it is difficult to verify a fixed income amount.
6. Some Policies Offer Lump Sum Payout
Though disability income insurance offers monthly payouts, there is another policy that offers lump sum amount when the individual is permanently disabled. With the permanent disability policy, you can get a lump sum amount all at once, and terminate the policy rather than having monthly payouts. Total and permanent disability means that one has to lose a pair of limbs.
7. The Government Encourages Everyone for the Insurance
At the age of 40, the Singaporeans are automatically subscribed to the Eldershield severe disability coverage by the government of Singapore. So if you are deciding what type of senior disability insurance to buy, you need to consider the following three levels of disability insurance.
- Eldershield – It provides a monthly cash payout for long-term care expenses.
- Eldershield supplement – It allows you to increase the monthly payout and also the payout period.
- Beyond Eldershield – It refers to the additional benefit to the existing coverage.
8. There Is a Criterion for Severe disability
The criteria for severe disability is when the person cannot perform at least three out of six activities of daily living (ADLs). The activities are:
- Washing (the ability to wash in the bath or shower or wash satisfactorily by other means)
- Dressing (the ability to put on clothes, take them off, use artificial limbs, unfasten the garments, or other surgical appliances)
- Feeding (the ability to feed oneself)
- Toileting (the ability to use the lavatory or manage bowel or bladder function and maintain a satisfactory level of personal hygiene)
- Mobility (the ability to move from room to room indoors)
- Transferring (the ability to move from a bed chair to an upright chair or wheelchair or vice versa)
Disability insurance offers a lot of measurable benefits, but the significant benefit that one can have is the peace of mind. With disability insurance, you can know that your loved ones and you are stable to live your life. So choose the right type of disability insurance and get the coverage you need for peace of mind.
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